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With market-based allowance trading systems, utilities and industrial companies can create their own versatile approach to meeting emissions standards. Chances
are your company is not capturing and maximizing all the opportunities this
new flexibility offers. Enron can help. We are committed to working with our
customers to design approaches that can allow you to effectively manage your
emissions portfolio while meeting present and future environmental compliance requirements.
Here's an example. Let's say your current supply of emission allowances far
exceeds short-term needs. However, you are concerned about future requirements,
so you are reluctant to fully utilize these assets.
Enron can provide the following solutions:
- Sell excess allowances but retain the right to buy them back at a future date.
This approach can generate large cash inflow for immediate investment while
providing the opportunity to meet future needs at a known price.
- Sell a portion of excess allowances and receive the right to sell the
remaining allowances at a known price in the future.
You generate cash inflow immediately for investment and lock in a set price
should remaining allowances become available for sale.
- Buy the right to sell the excess allowances at a known price in the future.
Use excess power, coal, or natural gas to "pay" for the option.
This solution effectively sets a minimum value on allowance assets. Payment
in gas or power allows for management of market risk without spending cash.
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